08:44 AM EST, 11/12/2024 (MT Newswires) -- Home Depot ( HD ) raised it full-year outlook on Tuesday as weather and demand for seasonal goods and outdoor projects helped the company log third-quarter results above market expectations.

The home-improvement retailer now anticipates adjusted earnings to decline about 1% in fiscal 2024, a smaller drop compared with its previous expectations for a decrease of between 1% and 3%.

Sales are now pegged to grow by roughly 4% for the ongoing fiscal year, up from the retailer's prior guidance for a 2.5% to 3.5% increase. Comparable sales are forecast to move down by about 2.5% for the full year versus the previous estimate for a 3% to 4% decline. The consensus on Capital IQ is for same-store sales to decrease about 2.8%.

"There should be incremental sales from hurricane-related rebuilding efforts in (the fourth quarter) and beyond," Wedbush Securities said in a client note. "What's missing from the improvement in results is a turn in core indoor home improvement categories even in the Western region (where housing indicators are stronger), which will be the next driver of this story."

For the three-month period ended Oct. 27, adjusted EPS declined to $3.78 from $3.85 the year before, but topped the Street's view for $3.66. Sales advanced 6.6% to $40.22 billion, ahead of analysts' $39.21 billion estimate. Shares of the company rose 1.4% in premarket activity.

"While macroeconomic uncertainty remains, our third quarter performance exceeded our expectations," Chief Executive Ted Decker said in a statement. "As weather normalized, we saw better engagement across seasonal goods and certain outdoor projects as well as incremental sales related to hurricane demand."

Comparable sales were down 1.3% at the company level, less than the 3.2% decrease modeled by analysts. The measure decreased 1.2% in the US. The number of transactions dipped 0.2% to 399 million. The average ticket prices edged down 0.8% to $88.65, while sales per retail square foot retreated 2.1%.

"While the company had the benefit of favorable/warm weather for most of the quarter and incremental storm-related sales, 3Q unequivocally came in better than what we expected three months ago," Truist Securities said in a note. Parts of the US were battered by severe storm weather, including hurricanes that drove flooding and damage during the just-ended quarter.

Home Depot's ( HD ) operating margin came in at 13.5% for the quarter, down from 14.3% a year ago. Total operating expenses widened to $8.01 billion from $7.33 billion in the prior-year period, according to the company.

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